Do you think China has lost its costs advantage against the US?The cost of manufacturing in China has been rising quickly in recent years. Actually the disparity of manufacturing costs between China and the US has narrowed such a great deal that according to the statistics from the Boston Consulting Group, for every dollar in cost of manufacturing in the US, it now costs 96 cents to manufacture in China – even before transportation and inventory costs are factored in. What do you think? Is this rising cost uniform across the whole of China? Or is it just more expensive as you described, only in the larger cities? This post was edited by sfphoto at 2015-8-14 17:16
Although its coastal cities have lost their cost advantages in low-cost manufacturing of consumer goods to low-income countries in Asia like Vietnam, Indonesia, Bangladesh, etc., China has retained its cost-advantages in high-value manufacturing of industrial and high-tech goods as compared to high-income countries like the U.S.A. This is because China is competing as a middle-income country with its labor productivity and industrial infrastructure comparable to or exceeding those of developed countries. China can't really compete against low-income countries in labor-intensive "sweatshop" industries like those in the apparel, footwear, giftware, toys, furniture, etc. industries which is why those "sweatshop" industries have been relocating to low-income countries for the past five years. What is happening though is that Li Keqiang's Internet+ business model is restructuring these labor-intensive "sweatshop" industries into e-commerce-based custom-manufacturing industries based on highy-integrated supply- and demand-chains.
coralbay Post time: 2015-8-14 16:46 static/image/common/back.gif
The cost of manufacturing is certainly higher in coastal provinces, typically the further west you ...
I guess we don't have all the figures for a more detailed analysis. But thanks for your ideas....I appreciate it.
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